Maximizing Donations: How Merchant Card Services Can Drive Nonprofit Growth

At a glance

• Trends shaping the future of payment processing: How to make the donation process more convenient and engaging for donors.
• Impact on your cash flow: While advanced payment technologies transform how nonprofits engage donors, high processing fees can significantly impact the bottom line. Here are three ways to address these rising costs.
• Next Steps: Aprio’s Payments Consulting Services team will offer a free consultation and cost analysis to Nonprofits looking to address these challenges.

The full story:

Whether using a QR code to view a menu and place a takeout order, setting up subscription payments for your Netflix account, or keeping a card on file with your favorite online retailer for easy checkout, people are accustomed to having multiple digital payment options available to them based on their preferences.

As nonprofit organizations work to streamline donation processes and engage more supporters, advancements in payment processing technology are proving essential to providing donors with the same flexibility they enjoy in other aspects of their lives. When you offer people more ways to donate, you open more opportunities.

Today’s trends are centered around efficiency and accessibility to help nonprofits boost donation volumes and cater to the preferences of donors while still controlling costs under tight budgets. Here are some key trends shaping the future of payment processing for nonprofits:

• Recurring Giving Programs: Offering automated, recurring donation options benefits donors and organizations and is becoming increasingly popular for nonprofits. Donors enjoy the convenience of a set-it-and-forget-it approach, which is a more budget-friendly way to support a cause they care about. Seeing the impact of their cumulative donations over time can also help foster a deeper connection and commitment to the cause they’re supporting. For organizations, ongoing donations can provide a steady and more predictable revenue stream, increase donor retention, and reduce administrative work.
• Text and QR Code Donations: Text-to-give and QR code donations provide an easy way for supporters to make contributions directly from their phones. Nonprofits often use these tools at events or within digital campaigns, where people can scan a QR code or send a text to donate in seconds. Simplifying the process can result in higher engagement and on-the-spot donations are often more impactful.
• Diversified Payment Solutions and Methods: With the rise of mobile usage, having mobile-responsive donation forms and payment processing capabilities is crucial for capturing donations on various devices. Additionally, donors want to see their preferred payment method available –credit/debit card, ACH, or digital wallets like Apple Pay and Google Pay.

The Financial Burden of High Processing Fees:

While advanced payment technologies transform how nonprofits engage donors, high processing fees can significantly impact the bottom line. For organizations operating on tight budgets, these fees reduce the funds available for programs and initiatives.

High processing fees are particularly problematic for organizations that receive a high volume of small contributions. Some donors are aware of this and may cover these fees during checkout if they have the option, but not all platforms provide this feature, and not all donors will opt-in.

Nonprofits are adopting new payment solutions and exploring options that offer lower processing fees. Here are some key considerations and strategies to keep in mind when thinking about your options:

• Understanding your rates: Let’s face it – merchant statements can be riddled with miscellaneous and hidden fees, making it hard to know what you pay each month. Aprio can conduct a review to ensure you’re receiving best-in-class rates so more donor contributions go toward your mission.
• Varying Fee Structures: While many processors default to flat rate pricing, many factors can determine what processing fee structure is best for your organization. What types of cards are you processing? What is the average donation amount? How many transactions are you running monthly? Are you categorized correctly to benefit from eligible discounted interchange programs? Work with a processor that offers multiple fee structures and can guide you through the best fit for your organization.

The digital payment landscape is ever-changing, and more people are donating online than ever. However, as these additional giving channels grow, so do the processing fees that can cut into the final funds received by nonprofits, impacting the bottom line and, ultimately, the funds left to fulfill their missions.

Aprio’s Payments Consulting Services team is here to help. Through our unique, complimentary consultative experience, we help nonprofits reduce their processing fees to gain better control of their finances, so they can do more with their dollars and further elevate their mission.

Schedule a free consultation with us today.

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